Sales tax

Sales tax

A percentage tax on the selling price of goods and services.

Sales Tax

A tax imposed on the sale of retail goods and services. That is, the government collects a certain percentage of the sale price on transactions where goods and services are traded at the retail level. While the retailers are responsible for paying the sales tax, most of the time they simply pass on the cost to customers. For example, if an item costs $10 and there is a 5% sales tax, the retailer will charge the customer $10.50. Proponents of sales taxes argue that they reward those who spend less and, therefore, do not punish those who earn more. Critics argue that sales taxes harm the poor disproportionately and can drive business to other jurisdictions. See also: VAT, Regressive tax.

Sales tax.

A sales tax is a tax imposed by state and local governments on transactions that occur within their jurisdictions.

The taxing authority determines which transactions are subject to tax and the flat rate at which the tax is calculated. Some countries, though not the United States, impose a national sales tax often called a value added tax (VAT).

They are (1) a consumed income tax, (2) a value added tax (VAT), which could take the form of a subtraction method VAT, a credit invoice VAT, or a retail sales tax (RST), which is analytically equivalent to a VAT, (3) a two-tier consumption tax based on a VAT, and (4) a yield exemption tax.

The Commission laid out the universe of ideas, ranging from a retail sales tax to a flat tax to a cash flow tax, but left the weighing of the benefits and burdens of the proposed alternatives to the reader.

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